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$2.8 billion war exposes Island's court problems

Where ever there are large companies operating on a global scale and loads of money, you can also expect lots of legal disputes.

The in-fighting of one of Europe's oldest dynasties over $2.8 billion in assets is not only exciting media attention worldwide, but will also put unwanted focus on Bermuda's lack of proper Supreme Court facilities for major commercial disputes.

The Thyssen-Bornemisza family case is expected to involve dozens of lawyers and support staff, witnesses, members of the European media, reams of paperwork, and hundreds of hours of court time. The civil action, which is scheduled to begin in April and last for six months, will run head on into the same time period as the Bermuda Fire & Marine Insurance Co. Ltd. civil action.

The Bermuda Fire action is scheduled for four months starting in May and will involve about 30 lawyers. The Thyssen-Bornemisza pre-trial hearings involved about 17 lawyers in court with more supporting behind the scenes.

Bermuda's claim to be a major international business centre will come under question as its court system strains under the workload.

The issue over facilities has come into the fore in both civil actions as lawyers and judges are currently attempting to deal with the problem.

The parties involved in the Bermuda Fire case have booked space at The Bermuda College International Commercial Arbitration Centre in case facilities in Hamilton are not available.

The Royal Gazette understands the negotiations are under way to do a $250,000 refit of Booth Memorial Hall on Court Street, the former headquarters of the Salvation Army. The proposal is to create two courtrooms for the case.

It was suggested that the parties in the Bermuda Fire action pay for the construction, however litigants turned that proposal down.

A source close to the case said the parties and the court have indicated that the Bermuda Government is responsible for providing proper facilities for disputes.

Bermuda's legal profession and international businesses sector have long complained about the small sizes of the three courts available for often complex commercial cases hitting Supreme Court in increasing numbers.

The lack of a system of court reporting has meant judges have had to rely on their own handwritten notes. The time they take to record proceedings has in turned lengthened the process and caused disputes as to what was said.

Often -- as in the case of the Electric Mutual Liability Insurance Co. action heard last year and reported extensively in the overseas media -- companies have had to hire their own court stenographer to speed things along and ensure there will be a record in the event of an appeal.

The Bermuda Fire suit, liquidators Ernst & Young are suing for recovery of assets they allege were stripped from the company and given as common stock in BF&M to shareholders.

The writ is over whether a fraud was committed in breaking Bermuda Fire & Marine into two companies. The case will pit the liquidators of one of the most controversial bankruptcies in Bermuda's history against some of the Island's top lawyers, law firms and businessmen as defendants.

Milligan-Whyte & Smith are the lawyers for the liquidators. Law firm Conyers Dill & Pearman, accounting firm Cooper & Lines, and 1991 Bermuda Fire directors Charles Collis (now deceased), William Cox, Donald Lines, Greg Haycock and Michael Collier are among those named in the writ. Marshall & Co.

are acting for a shareholders group made up of 830 members. The firm is also acting for BF&M. Appleby Spurling & Kempe are representing the former Bermuda Fire directors. Cox, Hallett & Wilkinson represent Conyers Dill & Pearman.

Hector, Dwyer & Associates represent Coopers & Lines.

The liquidators have estimated Bermuda Fire to be insolvent by about $1.4 billion.

In the Thyssen family case, patriarch billionaire Baron Hans Heinrich Thyssen-Bornemisza is being represented by law firm Appleby Spurling & Kempe.

Georg Heinrich Thyssen-Bornemisza, his son, is represented by Cox Hallet & Wilkinson. The trustees of the Continuity Trust, who are also defendants in the case, are represented by Conyers & Dill and Pearman.

A posse of lawyers from the UK have also arrived for the pre-trial hearings which are set to end this week. The lawyers in the case can at least take succour at the timely appointment of former Hong Kong Queen's Counsel Denis Mitchell as Puisne Judge in Supreme Court.

Judge Mitchell was appointed specifically because of his experience in commercial law and to fill a vacancy left when Richard Ground left to become Chief Justice in the Turks and Caicos Islands. The task will now be to schedule time and space in Supreme Court to handle the Thyssen-Bornemisza and the Bermuda Fire cases. Whatever the outcome, it could be a long hot summer for those involved.

In the Throne Speech the PLP Government has promised to address the complaints over Bermuda's courts. The two cases should help highlight the need for better facilities.

BUSINESS BUC